Retail Industry

When we talk about Retail, we refer to commerce conducted at the detail level, meaning direct sales to consumers. Among the most traditional formats are department stores, pharmacies, supermarkets, and others.

However, the level of market relevance that large retail chains have achieved today has not been a coincidence. A significant part of this success is due to companies’ focus on improving their customer-facing processes, with substantial investments in implementing both quantitative and qualitative methodologies to understand consumers and their needs.

In its early days, the retail industry in Chile consisted of only a few stores located in the most central areas of Santiago. The construction of the first hypermarket in 1976, located on Avenida Kennedy, was a significant milestone in the expansion of the retail industry in Chile. At the beginning of the 1980s, the first shopping centers began to emerge, such as «Dos Caracoles» in the Providencia district and the «Apumanque» shopping center. The commercial success of these stores by the late 1980s was largely due to the country’s economic growth, which increased consumers’ purchasing power, and the adaptation of North American business formats and models, resulting in the construction of the first «Chilean mall.»

The progressive increase in profits allowed retail chains to later expand throughout Santiago and even cross regional boundaries to reach the entire country. During the second half of the 1980s and much of the 1990s, the expansion of shopping centers and hypermarkets was steady.

The chains began to diversify their businesses, competing in various markets such as department stores; supermarkets in different formats (hypermarkets, traditional supermarkets, and convenience stores); real estate, through the management of shopping centers; financial services, through store credit cards; home improvement, and pharmacies, among others. The main chains that consolidated by the late 1990s were Cencosud, D&S, Falabella, Ripley, La Polar, SMU, Mall Plaza, Parque Arauco, and Hites, many of which are competitors in some markets and partners in others.

With the arrival of the new millennium, some of these chains also began expanding across Latin America, primarily Cencosud, Falabella, Mall Plaza, and Parque Arauco. Another strategy adopted by the chains during these years was the development of loyalty programs for customers, spanning the various businesses within the chain: department stores, supermarkets, and home improvement.

In recent years, the retail industry has had to adapt to the trends brought by new technologies, including e-commerce and mobile commerce. The industry’s challenges are primarily focused on developing new platforms to meet the demand for increasingly personalized products and services, offering a wider assortment to consumers seeking more specialized products, and improving levels of customer service and attention.